Tesla will fire 7% of its workers and Musk recognizes "difficult" way forward

The company seeks to reduce the sale price of its Model 3, after a year that the executive described as "the most challenging in the history" of the firm.

The electric car maker Tesla will dismiss more than 3 thousand employees, 7% of its plant workers, and will keep "only the most essential temporary employees and contractors," the CEO of the firm, Elon Musk, announced on a blog today.

The executive explained that the measure aims to reduce production costs, in order to provide space for lower the sales prices of the electric cars manufactured by the company.

"Although we have made a lot of progress, our products are still too expensive for most people"Musk wrote." We need to keep moving towards cheaper versions of Model 3, "he said.

The company had already announced that it would reduce the prices of Model 3, its first vehicle designed for mass consumption, as it faces a reduction in subsidies for the purchase of electric cars in the US.

Musk also recognized that 2018 was "the most challenging year" in the company's history and that "I had no choice" other than to carry out the dismissals. He also pointed out that "the way forward is very difficult".

"Tesla will need to make the cuts (of labor) at the same time that the rate of production of Model 3 is increased and manufacturing and engineering improvements are made in the coming months, "he said.

Tesla shares fell more than 7% in operations before the market opened after the announcement.